I had meant to blog about the myriad things we yootled about over Thanksgiving (a quasi-combinatorial transportation auction to decide how to get from NYC to DC and back, picking the clean-up crew and divvying other chores, and a wagering trivia game). But that’s old news now. In the meantime, Yootles have been rocketed to international fame thanks to the Yahoo! Prediction Market Confab in which Dave Pennock gave a glimpse of the Yootopia Project and the Yootles currency.

Which brings us to today’s blog post, guest-written by Yootles collaborator and co-author, Bethany Soule:

My finals period is winding down and, finding myself with a little breather in my schedule before the next axe fell, the only logical thing to do was go Contra Dancing on Saturday night.

I happened to wear a t-shirt with the phrase “Talk Nerdy to Me” emblazoned across the chest (a birthday gift from my future mother-in-law, I’ll have you know) because it coordinated so well with my Value-Village special Contra swishy skirt. This got a lot of attention from the nerdy and nerd-loving Contra crowd, both men and women alike. I spent a good deal of my time saying “computer science student” breathlessly as I spun wildly around the dance floor.

At the intermission, there were snacks and lemonade, and as I waited to get through the kitchen door, I was approached by yet another inquiry of: “So, what kind of nerd are you?” and responded with “computer science student.” As I wasn’t being spun off to the next section of the dance this time, my interviewer had time to ask what kind of CS. When I responded with my interest in AI including Auctions, Decision Mechanisms, and Game Theory, he asked, get this:

“Oh, so have you heard about this new currency over at Yahoo? Umm..” he pauses getting stuck looking for the name.. “Yootles..” I fill in. “Yeah!” he responds.

Anyway, he didn’t end up knowing much specifically about prediction markets or decision mechanisms, but had seen the slashdot post and was intrigued. We chatted about that a little and he recommended a sci-fi book he’d read about a futuristic dystopia that ran on influence or prestige markets, or something. Then I pointed him over to Danny.

But Dude! All I’ve gotta do is wear a nerd shirt, and I’ve got total strangers trying to clue me in to my own project! How cool is that.

Bethany and I had Ravioli tonight. Afterwards, there was a little left in the pot. Five pieces, to be exact. We usually use yootles for binary decisions (say, which one of gets the last portion of ravioli) but in this case, Bethany wasn’t sure she wanted all of it. What, we wondered, was the socially optimal division of the ravioli?
We decided we wouldn’t be risking much social efficiency by discretizing this decision into 6 options, characterized by how many pieces I (Danny) would get. We submitted our bids at yootopia.org as follows:

Now either it would cost me more than that (e.g., I enter
ybid bwallet -16) and I’m off the hook but give Bethany yootles, or it
would cost me less and I do the favor but get paid yootles.

It seems strange to give Bethany yootles because she forgot her wallet but
it’s by construction less skin off my nose than schlepping uptown for her.
The favor is to make it half my responsibility so once that’s been
established it’s only fair that whoever gets out of it gives some yootles
to the person who actually does it.

That’s the beauty of this protocol. I can offer to help and have it be a
Genuinely Generous Gesture, even if it doesn’t make sense (is not socially
optimal) for me to actually deliver on the favor.

ASKING FOR FAVORS:

If you’re asking for a favor you say “let’s have an auction to see if it
would be socially efficient for you to do X for me.” For example, I asked
Bethany if she’d mind (less than me) rotating my skate wheels. It was
no skin off her nose to bid in the auction — just bid truthfully and the
auction will only make her do it if she gets enough yootles to *want*
to do it (she didn’t). This is done with a Favor Auction (go toyootopia.org or text ‘ymech fav’ to 4INFO (44636) to learn
how to use it).

Summary:
In a Favor Auction, the default is that the favor does not happen and no payments are made, but if it’s socially optimal to do the favor then the favor seeker(s) pay the favor provider(s) to do it.
That’s in contrast to a Decision Auction where it’s assumed up front that a task has to get done. Everyone takes equal responsibility and it’s just a matter of deciding who does it.

We had a Reeves-Hayos family reunion in Yosemite last weekend. There were 17 of us and they all graciously agreed to be my guinea pigs for some yootles trials. In the planning stages of the trip we had a Decision Auction to determine if the reunion would involve a trip to Yosemite at all, as opposed to staying at my sister and brother-in-law’s house. Consistent with what straight voting would have decided, the auction’s conclusion was to go to Yosemite. My bid of $460 was pivotal and so I had to cough up some yootles to a few people who bid to stay home.

For the trip itself, being in Yosemite with no cell phone access, Bethany and I printed some paper yootles currency, about 130 yootles worth, divided among the family. We then used yootles auctions for a variety of decisions during the weekend, including chocolate distribution, sleeping arrangements, allocation of passenger seats and drivers, and at least one wager.